Employee retention strategies: How to reduce turnover in 2026

In a hurry? Here are the top three takeaways from our blog on employee retention strategies: how to reduce turnover in 2026. 

1. Satisfaction doesn’t guarantee retention: There's a clear gap between how employees feel and what they do next. While over 72% said they were satisfied with their work conditions, almost half were still likely to look for a new job. That means retention risk can exist even when engagement appears strong on the surface. 

2. Financial support and recognition matter most: Financial wellbeing benefits, incentives, and meaningful reward and recognition are presented as some of the strongest levers for reducing turnover. In a cost-of-living climate, practical support has a direct impact on whether employees stay. 

3. Retention improves when HR priorities match employee expectations: A trust gap exists when employees feel HR strategy is out of step with their real needs. Clear communication, visible action, and focus on priorities like wellbeing, flexibility and upskilling all help reduce churn.

Got time to stick around? Let's dive a little deeper.

Employee turnover remains high across the UK workforce, with many employees still considering a job move. This blog post explores the data behind employee turnover and the employee retention strategies your organisation can use to reduce turnover, retain skills and build long‑term engagement.

If you're looking for a broader approach, explore our employee retention strategies guide to build a long‑term plan.

How a competitive pay strategy helps reduce employee turnover

A competitive pay strategy helps attract and retain the right talent. It sets clear expectations around how you structure pay, ensuring compensation stays fair and consistent. Without this, you increase the risk of losing your employees to better-aligned offers.

HR leaders can combine salary benchmarking with a clear compensation plan. HR Datahub highlights in its compensation strategy guide that organisations without a structured approach to pay often see inconsistent decisions and weaker retention outcomes. A clear framework for base pay, incentives and benefits helps keep your compensation competitive and consistent. When you align pay with market data and apply learnings in a structured way, it strengthens trust and helps reduce your employee turnover.

How to become an employer of choice and improve staff retention

We discussed being an employer of choice in our blog post, 'You're Ready to Become an Employer of Choice', where we cover all the fundamentals. Take a read to help identify any potential gaps in your current employee retention strategy.

Becoming an employer of choice doesn’t just aid talent attraction and shorten the costly recruitment process; it also reduces employee turnover, helping you retain talent and, most importantly, thrive. 

Have you taken our Employee Retention Risk Assessment?

We went straight to the source (UK employees) to provide you with data-driven insights on employee opinions and expectations.

We asked over 1,000 employees these five questions:

1. How satisfied or unsatisfied, if at all, are you with your current work conditions (i.e. salary, benefits, work-life balance and career progression)?
2. How likely or unlikely are you to actively search for a new job opportunity?
3. If you are considering a job change in the new year, what would be the primary thing your current employer might offer that would influence your decision to stay?
4. What, in your opinion, should be the top priorities for HR in the upcoming year?
5. To what extent do you agree, or disagree, if at all, that there is a gap between your expectations and the HR priorities of your organisation?

Regarding question four, ‘What, in your opinion, should be the top priorities for HR in the upcoming year?’, we asked our respondents to choose their top five priorities from the list below:

• Reward and recognition across all levels of employees.
• Leadership development.
• Employee health and wellbeing actually being prioritised.
• Reassuring staff regarding how AI might impact their roles long-term.
• Flexible working remaining in place/policies becoming fixed.
• Improved internal upskilling/hiring to solve talent shortages.
• Implementation of pay transparency.
• Culture and change management.
• Companies backing up PR-focused diversity claims with action.
• Employer branding as a talent attraction tool.
• Implementation of blind hiring.

Read on to discover the top five matters your employees think you should be prioritising. 

What the data reveals about employee turnover trends

Interestingly, when answering question one, 72.16% of our employee respondents were satisfied with their current work conditions. In comparison, almost half (49.30%) said they were likely to search for a new job opportunity soon. 

Is employee satisfaction enough to prevent turnover? We’ll explore what employees told us during this blog, but for now, we’ll continue to reveal more results from our survey.

Which employees are most likely to leave?

What’s the majority age range of your workforce? Unless they’re mainly over 55, you’ll want to see the following results.

We broke the responses down into age groups and found that out of those who said they were likely to look for a new job opportunity:

• 63% were aged 18 – 24.
• 66.34% were aged 25 – 34.
• 53.33% were aged 35 – 44.
• 47.03% were aged 45 – 54.
• 28.45% were aged 55+.

If your workforce predominantly consists of employees aged 18 to 34, you may be at risk of high employee turnover. So, the question is: how can we lower the risk of high employee turnover?

How to reduce employee turnover

We may have asked if employees were likely to look for new opportunities, but we also asked what would tempt them to remain with their current employer. At the top of the list are financial benefits and incentives, with 36.93% of the vote.

Why financial wellbeing benefits reduce employee turnover

Financial wellbeing benefits are one of the most effective ways to reduce employee turnover. In our research, 36.93% of employees said financial benefits and incentives would influence their decision to stay with their current employer. 

Taking a deeper dive into financial wellbeing benefits and incentives, we can further explore the generational divide through the figures below:

• 35% were aged 18 – 24.
• 34.63% were aged 25 – 34.
• 36% were aged 35 – 44.
• 42.47% were aged 45 – 54.
• 35.57% were aged 55+.

21% of people in their fifties have had to use their savings “due to high borrowing costs and inflationary pressures,” with those in this age group having been hit the hardest by the cost-of-living crisis (Money Age).

With this detail in mind, it makes sense that employees in the 45 – 54 age range are more driven by financial benefits and incentives. We’ve created several blogs that are valuable resources in helping you to get your employee benefits package right.